S&P: Wise Metals outlook developing

Standard & Poor's said it revised its outlook on Wise Metals Group LLC to developing from positive and affirmed all its other ratings, including its CCC corporate credit rating.

According to S&P, the outlook revision reflects the unexpected decline in the company's liquidity levels owing to the rise in aluminum prices, weaker-than-expected earnings for the first quarter of 2007 and lower capacity use levels as a result of inventory buildups by the company's customers in anticipation of new contracts.

In the agency's opinion, the low level of liquidity leaves little cushion for unanticipated events that could quickly evaporate remaining availability.

S&P said it expects the company to act to address its liquidity position, adding that the ratings on Wise Metals Group reflect the company's participation in a mature and consolidated industry, limited operating diversity, customer concentration risk, negative operating margins, thin liquidity and aggressive financial leverage.

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